To promote women entrepreneurship, the country’s first Women’s
Bank — the Bharatiya Mahila
Bank (BMB) — has chosen to do away with
collateral for loans availed by the fairer sex.
The BMB will provide collateral-free loans for amounts up to Rs 1
crore, which will instead be covered under the Credit Guarantee Fund
Trust for Micro and Small Enterprises (CGTMSE).
For loans availed for smaller amounts such as Rs 20,000, the bank will completely waive off the requirement for collateral.
“Women are moderate risk takers. So the question of collateral
should not really arise,” said Usha Ananthasubramanian, CMD, BMB. The
issue of collateral also tends to discourage women from availing loans,
she pointed out, since much of the immovable property tends to be in the
name of the husband or father. The bank, which was set up in November
last year, has begun to receive queries for its various credit schemes
such as kitchen loan, loans to set up beauty parlours, day-care centres
and catering units apart from plain vanilla products such as car and
education loans.
The CGTMSE is a credit guarantee scheme, where a premium is paid
either by the lender or the applicant, provides a guarantee cover for up
to 80 per cent of loans availed by women owned or operated micro- and
small enterprises.
The BMB, which has set up nine branches, plans to scale up
operations and set up another 16 branches in various state capitals this
fiscal. From 2014-15, it will expand to Tier II cities and smaller
towns as well as unbanked areas.
As part of its expansion, it will recruit about 300 candidates
over the next few months and is also looking at recruiting people who
have left the banking industry but wish to return.
“We have a staff strength of about 150 officials right now, but
they are on a three year deputation from other banks. The direct
recruits will be trained to take their places when the tenure comes an
end and also man the new branches,” said Ananthasubramanian. The BMB has
already recruited about 110 such candidates through exams conducted by
the Institute
